“Flight to the suburbs” noted
There is good news to report on the building construction front, with a new report showing builder confidence returning to pre-pandemic levels of optimism. One Miami developer is even taking a lesson from the pandemic in redesigning a planned high-rise luxury hotel and residences to include a medical and wellness center under the same roof.
The latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI) report shows builder confidence for new single-family homes rose 14 points to 72 in July. That’s the index score from March before the coronavirus pandemic hit. Any score over 50 reflects more builders view conditions as being good than poor.
Builders report they’re seeing stronger traffic and interest in new home construction given that existing home inventory is lean. Low interest rates are also fueling demand. “New home demand is improving in lower density markets, including small metro areas, rural markets and large metro exurbs, as people seek out larger homes and anticipate more flexibility for telework in the years ahead,” according to NAHB Chief Economist Robert Dietz. “Flight to the suburbs is real,” he adds.
All the indicators that go into the index are up, including current sales conditions, sales expectations in the next six months, and prospective buyers’ traffic. Geographically, the areas hit by the most pessimism in recent months saw the greatest gains in this new report. The Northeast jumped 22 points to 70 and the Midwest rose 18 points to 68. The West rose 14 points to 80 and the South increased 10 points to 73.
Artist rendering of the Legacy Hotel & Residences, Miami. Courtesy, RPC Development
In Miami, commercial developer Dan Kodsi of Royal Palm Companies sees additional market opportunity arising from the pandemic and increasingly health-conscious consumers. He has announced a redesign of the Legacy Hotel & Residences, scheduled to break ground in downtown Miami this fall. Working with healthcare expert Stephen Watson, they are adding medical and wellness centers under the title “Center for Health + Performance,” designed to meet pandemic qualifications.
The Center will include operating rooms, diagnostic and lab facilities, and a 50,000 square foot medical clinic with suites and on-site pharmacy. Part of Miami WorldCenter, the Legacy will be a 255-room hotel with another 278 branded condominium residences above it, together with convention and retail space. The hotel will include air purification and filtration systems, no-touch voice-activated elevators, anti-microbial surfaces, and robot-controlled scheduled sterilization cleaning and UV light sanitation in high traffic areas.
LMA Newsletter of 7-20-20
